U. S. Credit Card GDV to Decline to 8% CAGR by 2025

U.S. credit card GDV (gross dollar volume) for Visa [V], Mastercard [MA], American Express [AXP], and Discover [DFS] in the first-quarter 2019, declined to a 7.0% year-on-year (YOY) gain, compared to 9.8% one-year ago, a 9.4% YOY gain in 1Q/17 and an 8.6% jump in 1Q/16.

NEW REPORT from CardData reports $932 billion in gross dollar volume (GDV) for 1Q/19, compared to $1007 billion for the prior quarter, and $871 billion for 1Q/18. First quarter GDV (purchases + cash advances) is now growing at an annual compound growth rate (CAGR) of 8.76% since 2014. Mastercard posted the strongest growth in first-quarter U.S. credit card volume.

Underlying Factors

The new CardData report notes first-quarter YOY growth rate slowed by 280 basis points (bps), reflecting the aberrant first three months of 2019 wherein the impact of widespread bad weather, a lingering government shutdown and Wall Street recessionary concerns (based on an inverted yield curve), plus depressed consumer and business spending kicked-in.

Outlook

The new CardData report notes the percentage of consumers expecting business conditions will be better six months from now increased from 17.2% to 19.9%. The proportion expecting more jobs in the months ahead increased from 16.8% to 17.2%, while those anticipating fewer jobs decreased from 14.3% to 13.2%.

PYRPTS President Robert McKinley, a seasoned payments research analyst of 34 years, personally vets each report listed for relevance and reliability. He is also the Senior Analyst for CardData, CardFlash, and CardTrak.

Author: Robert McKinley

Robert McKinley, with 34 years experience covering payment cards and payment systems, is pro bono Senior Analyst and Editor-in-Chief for CardFlash. He is the retired founder of RAM Research, CardWeb and CardTrak. McKinley served as an expert witness in 100+ litigations including two multi-$billion trials, testified before the U.S. Congress, chaired multiple payments conferences, hired as consultant by Fortune 100 companies and several overseas financial institutions. Mr. McKinley does not hold investments in any companies discussed herein. Full Bio: www.rbm4.com